Whitepapers

EMERGING OPPORTUNITIES IN CANNABINOIDS

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Introduction

Cannabis belongs to the family of Cannabaceae; known to produce a unique family of terpeno-phenolic compounds called cannabinoids. The most well-known are Cannabidiol (CBD), the main component in industrial hemp, and Δ9-tetrahydrocannabinol (THC), the psychoactive component in Marijuana. Legality of cannabis varies by country. The policy of use in most countries is regulated by the United Nations Single Convention on Narcotic Drugs (1961), the Convention on Psychotropic Substances (1971) and the Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (1988). More than 0.3% THC is considered to be illegal and not accepted for use and sale in many parts of the world.

In United States, California became the first state to legalize the medical use of cannabis with the passage of the Compassionate Use Act of 1996. In 2012 Colorado and Washington became the first states to legalize recreational use. As of November 2018, ten states (Alaska, California, Colorado, Maine, Massachusetts, Michigan, Nevada, Oregon, Vermont, and Washington), the District of Columbia, and the Northern Mariana Islands have legalized the with its commercial sale permitted in all except Vermont and D.C. Uruguay and Canada are the only sovereign states with fully legalized nationwide consumption and sale of recreational cannabis. Countries that have legalized the medical use of cannabis inclueds Australia, Canada, Chile, Colombia, Cyprus, Finland, Germany, Greece, Israel, Italy, Norway, the Netherlands, New Zealand, Peru, Poland, and Thailand. In South Africa, it is legal to possess and cultivate, but not sell.

With legalization, many companies are riding on the CBD wave and developing potential applications in order to garner a share in the market. The different combinations of CBD and THC that are possible creates huge opportunities for these players particularly in food, cosmetic and medical product areas. In the food and beverages area, cannabis infused food in the form of edibles and drinkables have already hit the market. Production of cannabis edibles requires appropriate testing for bio contaminants and pathogens. Infused edible products must indicate on the label that they have been tested for pesticides, heavy metals, mold, and residual solvents. No public safety guidelines or U.S. Food and Drug Administration label requirements exist, yet people with chronic medical conditions - cancer, Parkinson’s disease, ALS, Multiple sclerosis use these products for pain and symptom management.

Green Roads is a US based manufacturer and supplier of CBD Hemp Oil and CBD products. The company has been selling its products under different categories such as CBD oils, CBD syrups, CBD edibles, etc. CBD edibles include gummies, toads, froggies, and sleepyz’s. The products are tested by a third party lab, just to ensure that the bottle contains exactly what is listed on the label. A few other products from Green Roads include CBD infused products such as tea and coffee, oil for pets, pain cream and many more.

Tauriga Sciences Inc. has developed a CBD Infused Chewing Gum Product Line under the name: Tauri-Gum™. The Company is currently selling both its Tauri-Gum™ individual blister pack and retail display box. This CBD Gum has been manufactured via a patented process (U.S. Patent # 9,744,128). The product is initially being completed exclusively in Mint flavor.

Kiva and Défoncé are makers of Cannabis based chocolates. Kiva's new gummies pair custom combinations of THC, CBD, and a range of carefully curated terpenes to produce a tailored cannabis experience. Défoncé Chocolatier’s bars contain 90mg of THC, and each serving is 5mg of THC. By Chloe, the vegan-food chain in New York has been selling CBD- infused baked foods with CBD oil. Feelz is a line featuring more than 25 desserts, from cupcakes and brownies to cinnamon rolls with health-boosting properties and also dog bones for the customers’ pup! By Chloe also uses two-ingredient CBD Oil, made from Cannabidiol.

True leaf Inc., one of the first companies to market hemp based cannabis pet products, sells functional chews, supplement oils and dental sticks for dogs. Recently the company added five hemp-based treats with innovative crunchy outer shell and a soft inner core with hemp. It also launched two hemp toys for cats providing 5 health care benefits: Calming, Skin+Coat, Anti-Hairball, Urinary Tract support, and Senior, to promote hip and joint health in adult cats.

Use of cannabis in cocktail is expected to grow quickly in states where recreational marijuana use is legalized and multiple coffee shops in New York offer cannabis infused coffees.

Hop Chronic IPA is THC- infused non-alcoholic beer that will be launched in 2019 by Flying Dog Brewery. In partnership with Green Leaf Medical Cannabis, the product is meant for people who have medical recommendation for the use of cannabis. More experiments are in progress on cannabis based beer in legalized states. Terpenes are being incorporated to provide different aroma and tastes. Called “Grain wave”, the beer, from the beverage firm Ceria, is a Belgian-style non-alcoholic white ale infused with 5mg of THC. The beer was introduced in Colorado in December 2018.

Cosmetic Applications

Cannabis’ anti-inflammatory and anti-aging properties have led to the recent advances in cosmetic area. According to EC Cosmetics Regulation 1223/2009, CBD is listed as an ingredient that can be used in any cosmetic product with no restrictions established. Cosmetic companies are exploring the incorporation of CBD for its antioxidant, skin protecting and conditioning properties.

Hemp seed oil is most commonly found in lotions, conditioners, lip balms, and other moisturizing products. L’Oréal Paris uses hemp seed oil as an ingredient in skin care products for its high concentrations of omega-3 and omega-6 aimed at increasing the amount of essential fatty acids and linoleic acid found in skin cell membranes. Hemp seed oil is an ideal cosmetic ingredient for providing hydration to skin. CBD oil is also non-comedogenic and helps to soothe stressed out skin.

French beauty label Sephora launched its first cannabis-infused cosmetics brand called “High Beauty” in September 2018. It later launched “High Expectations”, a cannabis facial oil, and “High Five”, a cannabis facial moisturizer. It recently created high CBD Formula Body Oil in rollerball design to relieve dryness, redness, dullness and uneven skin texture.

The skin care brand Vertly Balm, has incorporated CBD in its products (lotion, lip balm, bath salts) to help consumers manage stress and help relieve pain.

MGC Derma, an Australian based company, has commercial products for acne prone skin, sensitive skin and for anti-ageing application. Its products range from a CBD Brightening Facial cream, CBD BB concealer repair cream, Anti- aging night serum, CBD Stem Cells and Peptides Eye Cream and many more. Its parent MGC Pharmaceuticals has been developing and supplying high quality Cannabinoids and the non-psychoactive Cannabidiol (CBD) for the emerging global market.

Carolina Hererra’s launched two new cannabis infused fragrances presented in chromed iridescent bottles as 212 VIP Party Fever and 212 VIP Men Party Fever, managed successfully to became one of the biggest buzz words in the beauty world.

Pharmaceutical Applications

Cannabis is known to treat many disease conditions such as Cancer, Glaucoma, HIV/AIDS, Muscle spasms, Seizures, Severe pain, nausea, Cachexia or dramatic weight loss and muscle atrophy (wasting syndrome), Multiple sclerosis, Schizophrenia, adn Bladder hyper- reflexia. Numerous investigations have already been done on the use of cannabinoids for the treatment of chronic pain, spasticity, anorexia, and nausea. According to Botanical Rush cannabis skincare line, cannabinoids are effective against symptoms of psoriasis, eczema, dermatitis, inflammatory skin diseases and, in some cases, even skin cancer.

CB1 and CB2 are the primary receptors of endocannabinoid system, playing a major role of expression in brain and immune system. They belong to a family of seven transmembrane Guanosine Binding Protein Coupled Receptors, widely expressed and distinguished by their specific functions, localization and signaling mechanisms. Major Cannabinoids have multiple targets within the central nervous system and can modulate activity of neurons, glia, and microglia. Tetrahydrocannabinol (THC) may also demonstrate anti-inflammatory effects independent of CB1 and CB2 receptors.

CBD has low affinity for CB1 and CB2 receptors. CBD’s anticonvulsant properties are linked to regulation of voltage gated potassium and sodium channels and GPR55. However, Delta-9-THC binds to other targets, modulates neuronal excitability and neuro-inflammation.

The USFDA has approved two oral cannabinoids for use as medicine: Dronabinol and Nabilone are listed under schedule II drugs. Nabilone was originally developed by Eli Lilly and Company.

Cesamet (Trade name for Nabilone) and Marinol (Trade name for Dronabinol) are used in controlling nausea and vomiting caused by chemotherapeutic agents used to treat cancer. Syndros, liquid Dronabinol, is being used to treat loss of appetite in AIDS affected of patients.

Nabiximols, an oromucosal spray, is used for treatment of spasticity associated with Multiple sclerosis. This drug is not approved in the United States, but is approved in several European countries, Canada and New Zealand.

In June 2018, the USFDA approved Epidiolex (cannabidiol or CBD) from GW Pharmaceuticals. Epidiolex is an oral solution for patients two years and older to treat Lennox-Gastaut syndrome and Dravet syndrome - two severe forms of seizures that begin in childhood. It has a proven medical use but a low risk of abuse.

There are currently many drugs in clinical trial phase.

Thrudermic™ formulated by Pivot pharma is a controlled release nanotechnology transdermal path for delivering THC and CBD through skin penetration reaching the blood stream without altering the skin structure. Following the legalization, there have been many studies commissioned to understand the mechanistic pathways.

Canadian scientists provided important insight into brain mechanisms underlying nausea. Studies showed that THC reduces nausea by reducing serotonin in brain region, and also through deactivation of the 5-HT3 receptor and activation of 5-HT1A serotonin receptor by blocking their release from brain cells.

Ebbu labs is working on genetic editing of cannabis plant which is different from genetic modification to develop cannabinoid formulations tailored for specific effects and specific consumer products goods.

Study on use of D9 tetrahydrocannabinol (THC) and cannabidiol (CBD) for hematologic reconstitution and graft versus host disease treatment after bone marrow transplantation, showed that treatment with THC-high and CBD-high cannabis extracts reduced the severity of GVHD.

Nemus Biosciences has developed a patented prodrug formulation of THC for the treatment of glaucoma. The product NB1111 is easier to deliver to the human eye.

Startups

Hyasynth Bio., a Canadian startup company is using genetically engineered yeast to isolate high quality cannabinoids for exponentially cheaper products. The strains of yeast are genetically modified, but the products are not GMOs. Organigram has invested in Hyasynth Bio which uses enzymes and yeast strains to produce cannabinoids CBD for use in beverages or pharmaceutical products.

Jane Technologies, Inc., a retail tech company started in April, 2017 by Socrates Rosenfeld, a former U.S. Army veteran, created the cannabis industry’s first ecommerce marketplace in US with funding of $6M through private investors. The company has made rapid approach to nearly 500 dispensary partners spread across 19 states and US territories.

Acquisitions

With the acquisition of Jupiter Research which holds proprietary inhalation technology, TILT Holdings Inc. drives to run as unified company to reach the goal of attaining consolidated and centralized services for all industry verticals: cultivation, production and retail.

In Jan 2019, Whistler Medical Marijuana Corporation was acquired by Aurora Cannabis as their 9th acquisition to penetrate the market by appealing to consumers looking for safe, organic options.

Pivot Pharmaceuticals Inc. acquired ERS Holdings LLC, a privately-held California which has patents on Ready to Infuse Cannabis technology (“RTIC”). The acquisition will focus on transformation of their patents and processes into therapeutic consumer goods.

Tilray recently acquired Natura Naturals, a licensed cultivator of cannabis based in Leamington, Ontario. It will acquire Manitoba Harvest to expand its product portfolio and exploit Manitoba’s expertise in working with cannabinoids, including Cannabidiol (CBD) to develop innovative new CBD wellness products and hemp-based consumer food products.

Verano Holdings acquired Four Daughters Compassionate Care on Feb 5, 2019. Verano has commenced construction of a cultivation and production facility at Sharon, Massachusetts.

Seng-Vital, a German vaporizer manufacturing company acquired Lifespot Health Ltd., an Australian medical diagnostic and monitoring technology company. The company introduced Cannamed Bluetooth Vaping System which can adjust dose strength on a screen, and share data with medical professionals in real time to provide valuable insight into consumption trends and pain relief. It is planning to work in developing geolocation functionality that could prevent users from vaping in certain areas, near schools or hospitals.

Collaborations

Green Roads is involved in a pilot program with the University of Florida to bring hemp farming back to the state to bolster its profile, connections and potential supply.

Cronos Group Inc., a Cannabis producer, partnered with Ginkgo Bioworks Inc. in a $122 million deal to genetically engineer yeast for producing active compounds in marijuana for scalable and consistent production of a wide range of cannabinoids, including THC, CBD and a variety of other lesser known compounds while targeting rarer compounds such as cannabigerol and cannabichromene for potential use in treating chronic pain, nervous disorders, nausea, weight loss, and some mental illnesses. Cronos Group has joint venture with U.S. cannabis retailer MedMen Enterprises Inc. to develop branded products.

NEMUS Biosciences Inc., in partnership with University of Mississippi, has been working on the development and commercialization of bioengineered cannabinoid-based drug candidates.

An agreement between Lonza and Emerald Health Pharmaceuticals for large-scale manufacturing of cannabinoid based drug for the treatment of multiple sclerosis and systemic sclerosis. While Lonza carries out the product development, Emerald would involve in clinical trials.

Patents

A number of patents have been filed stating the use and therapeutic applications of Cannabis. Some of them have been listed below:

Re-examined 2 weeks after the treatment, determining that the inflammation was reduced in the gums and no sensitivity was reported.

WO2017160687A1 filed by Vitality Biopharma has claimed the use of TRPV1 agonists exhibiting promyelinating activity selected from the group consisting of zu-capsaicin, capsaicin, cannabinoids, such as cannabidivarin and cannabidiol, anadamide, vanilloids and combinations thereof for treating central nervous system (CNS) demyelinating disorder.

US20190015383 has claimed the use of water-soluble cannabinoid compositions to reduce pain, nausea, inflammation, stress and promoting sleep, preparing for and/or recovering from exercise, or boosting energy.

US20180338931 filed by GW Pharma deals with reduction of total convulsive seizure frequency in Lennox-Gastaut or Dravet syndrome by using cannabidiol.

It is quite evident from the above that global interest in CBD in terms of research and products is only going to grow exponentially in the future. While the interpretation and enforcement of laws will continue to pose a challenge, Cannabis legalization will indeed be a blessing for patients suffering from painful chronic illnesses.